Shaul Elovitch, Israel's rising telecommunications tycoon, has obtained a $140 million loan to partially finance the purchase of the Amos 5 communications satellite by Spacecom Satellite Communications Ltd. (TASE:SCC). Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL) will provide $100 million and Amitim (the eight nationalized old pension funds) will provide $40 million.
The Amos 5 will be ready for commercial operations in early 2011.
Elovitch owns 57% of Spacecom through Eurocom Group, and Israel Aerospace Industries Ltd. (IAI) (TASE: ARSP.B1), which builds the Amos satellites, owns 16.8%.
Spacecom will repay the loan in six-month payments of principal and interest between the end of 2012 and the end of 2018. The interest will be based on the average annual yield on government bonds plus an agreed upon margin and linkage to the Consumer Price Index (CPI).
Migdal and Amitim will receive a priority lien on the Amos 5 satellite and its revenue. They will also receive liens on the Amos 3 satellite and its revenue as well as a lien on the Amos 2 satellite and its revenue after Spacecom repays the bank loans taken to purchase the satellite. The Amos 2 and 3 are already in orbit and operating.
In July 2008, Spacecom bought the Amos 5 satellite from Russia's JSC Academician MF Reshetnev Information Satellite Systems.
Spacecom's share was unchanged at the opening today at NIS 46.42, giving a market cap of NIS 669 million.
Published by Globes [online], Israel business news - www.globes-online.com - on October 27, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009